Is the prestige property market out of control?

“I’ve always gone out on a limb and remained positive in the face of everything throughout my 30-year-plus career. Now, I can’t. I have to be honest here. This is the beginning of the end of the higher end. I’ve never spoken so negatively about the property market to the media in my life.” – Gail Havig, real estate agent

The story goes on to say:

Research from RP Data released last week showed that the top end of the property market suffered a significant fall in median house prices in the March quarter – 20 per cent of the most expensive capital city suburbs recorded a 5.4 per cent fall in value over the year.

A fall of 5.4 per cent over 12 months isn’t significant. We can cope with that. The issue is whether the price fall is enough to scare the buyers away, which will have the self-prophecying effect of seeing further price falls.